According to the ATF website if you have black tip 7.62 NATA or 7.62x39 steel core ammo it is considered illegal armor piercing ammo. But .223 green tip and 30.06 black tip are not considered illegal:
List of Armor Piercing Ammunition
KTW AMMUNITION, all calibers. (Identified by a green coating on the projectile)
ARCANE AMMUNITION, all calibers. (Identified by a pointed bronze or brass projectile)
THV AMMUNITION, all calibers. (Identified by a brass or bronze projectile and having a headstamp containing the letters SFM and THV)
CZECHOSLOVAKIAN manufactured 9mm Parabellum (Luger) ammunition having an iron or steel core. (Identified by a cupronickel jacket and headstamp containing a triangle, star and dates 49, 50, 51, or 52. The bullet is attracted to a magnet)
GERMAN manufactured 9mm Parabellum (Luger) having an iron or steel bullet core. (Original packaging is marked Pisolenpatronen 08 m.E. May have black colored bullet. This bullet is attracted to a magnet)
MSC AMMUNITION, Caliber .25. (Identified by a hollow point brass bullet. NOTE: MSC ammunition Caliber .25 identified by a hollow point copper bullet is not armor piercing)
BLACK STEEL ARMOR PIERCING AMMUNITION, All Calibers, as produced by National Cartridge, Atlanta, Georgia.
BLACK STEEL METAL PIERCING AMMUNITION, All Calibers, as produced by National Cartridge, Atlanta, Georgia.
7.62mm NATO AP (Identified by black coloring in the bullet tip. This ammunition is used by various NATO countries. The U.S. military designation is M61 AP)
7.62mm NATO SLAP (identified by projectile having a plastic sabot around a hard penetrator. The penetrator protrudes above the sabot and is similar in appearance to a Remington accelerator cartridge)
PMC ULTRAMAG .38 Special caliber, constructed entirely of a brass type material, and plastic pusher disc located at the base of the projectile. NOTE: PMC ULTRAMAG 38J late production made of copper with lead alloy projectile is not armor piercing.
OMNISHOCK, a .38 Special cartridge with a lead bullet containing a mild steel core with a flattened head resembling a wad cutter. (NOTE: OMNISHOCK cartridges having a bullet with an aluminum core are not armor piercing.)
7.62x39mm with steel core. (NOTE: these projectiles have a steel core. Projectiles having a lead core with steel jacket or steel case are not armor piercing)
NOTE: THE FOLLOWING CARTRIDGES HAVE BEEN REMOVED FROM THE DEFINITION OF ARMOR PIERCING AMMUNITION:
5.56MM (.223) SS109 and M855 Ammunition, Identified by a green coating on the projectile tip.
U.S. .30-06 M2 AP, Identified by a black coating on the projectile tip.
The distinction in the law is made on the basis of whether or not it is handgun ammo. Apparently because there are sufficient numbers of handguns that will fire the 7.62x39 (huh? I didn't know there were any!) and .308 cartridges they declared it handgun ammo.
I love the part about the .25 ACP ammo with a brass bullet is considered AP but with a copper bullet is just fine. Considering what most experts think of the .25 ACP round I find it incredibly amusing our Congress Critters consider it AP.
Just another one of the contributors to Huffman's rule of firearms law.